Goldman Sachs Analyst Questions Autodesk's Revenue Growth And Total Addressable Market Targets

Goldman Sachs analyst Kash Rangan maintained a Sell rating on AutoDesk Inc ADSK and lowered the price target from $230 to $225.

Rangan noted Autodesk as a category leader with a dominant market position within design and engineering software.

The analyst noted the company’s strong competitive positioning and relative stickiness could command operating margins north of 40% in the long term.

Also Read: What’s Going On With Autodesk Stock After Earnings?

While appreciating fiscal first-quarter 2025’s performance, Rangan highlighted that Autodesk is becoming increasingly reliant on price in its core design business (driving approx. half of its 10 – 15% mid-term growth target), which led to the analyst doubting the achievability of its $95 billion TAM (fiscal 2027) and the ability for revenue growth to inflect towards the midpoint of its 10-15% framework.

Furthermore, with an already-mature adjusted operating margin profile (>35%), continued leverage could prove more muted, per the analyst. He said that investors may need to be more concerned about the sustainability of ADSK’s mid-term Free Cash Flow (FCF), given the results of the company’s internal investigation.

Price Action: ADSK shares are trading higher by 5.32% to $222.76 at the last check Wednesday.

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